Cook County Board Approves Sales Tax Hike
Updated 07/15/15 - 4:35 p.m.
CHICAGO (CBS) -- The Cook County Board voted Wednesday to approve a sales tax hike proposed by Board President Toni Preckwinkle, an increase she railed against five years ago.
The board approved the hike in a 9-7 vote, with one present vote. The sales tax hike would mean Chicagoans would be paying the highest sales tax rate in the nation: 10.25 percent, including state, city, county, and mass transit shares.
Rates in the suburbs would vary from one municipality to the next.
The increase goes into effect Jan 1.
Not long after the vote, Preckinwkle faced reporters to say her administration and the board had done all it could to save money and could not wait for Springfield to act.
"By virtue of this action, we can look forward to having the revenue needed to begin addressing our Pension Fund shortfall, as well as the higher legacy debt service payments that are on the horizon.
The revenues we obtain from the sales tax will also allow us to direct needed funding to infrastructure throughout the County through projects that would otherwise be delayed because of diversions from the road fund," she said.
But as she said before, Preckinkle said if the state legislature and the governor agree witht he county pension relief plan she'll re-examine how much revenue is needed.
Preckwinkle won office in 2010 by pledging to roll back what remained of an unpopular penny-on-the-dollar sales tax hike enacted by her predecessor, Todd Stroger, but she has defended her proposal to reinstate that tax hike. Preckwinkle has said the county's $6.5 billion pension shortfall makes it necessary to raise taxes, and there is no support for a property tax hike.
She was lobbying the 17 board members as late as Tuesday to get their support for her sales tax plan.
Wednesday morning, Preckwinkle told commissioners the county cannot afford to wait for state lawmakers to act on pension changes she is seeking, because the county must inform the state of its sales tax rate by October 1.
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During a public comment period at Wednesday's meeting, abor unions and retirees testified in favor of reinstating the tax hike.
Hazel Crest Mayor Vernard Alsberry was among the local municipal leaders supporting the plan.
"Let's put all the politics aside. Let's be real. Let's vote for this tax," he said. "You know we need it, commissioners. There's no ifs, ands, or buts about it. We've got to bite the bullet."
Tanya Triche, general counsel for the Illinois Retail Merchants Association, was among business leaders blasting the proposed tax hike.
"Not only would this measure give Chicago the very dubious distinction of having the highest sales tax in the nation at 10.25 – and don't forget, that's 11.25 if you're in the McPier District, which many retailers and restaurants are in – but it's another strain on businesses who are close to this county's borders," she said.
She said people will go elsewhere to shop if sales taxes go up in Cook County.
Some commissioners have proposed amendments to the plan, including one requiring a two-thirds vote, instead of a simple majority, to approve the hike – the same standard required to increase property taxes – while another would require every penny of the tax increase go directly to the county's employee pension fund, which Preckwinkle said is the driving factor in budget shortfalls. Another amendment would repeal the sales tax after one year.
Preckwinkle has said she would consider scaling back the tax if her proposed changes to the county's pension system are approved by state lawmakers, but that plan has stalled in Springfield, as the governor and General Assembly has been unable to solve their own pension crisis, or agree on a budget plan.
Preckwinkle's push for a sales tax hike is a complete 180 from the platform that helped her get elected in 2010, when she pledged to eliminate what remained of a penny-on-the-dollar sales tax hike pushed through by her predecessor, Todd Stroger, in 2008.
Stroger agreed to cut that sales tax hike in half in 2009, and Preckwinkle went on to defeat him in the 2010 election, and then roll back the remaining half-penny of the tax hike by 2012.
